What began more than sixty years ago as a modest proposal that a mathematician and an economist write a short paper together blossomed, in 1944, when Princeton University Press published Theory of Games and Economic Behavior. In it, John von Neumann and Oskar Morgenstern conceived a groundbreaking mathematical theory of economic and social organization, based on a theory of games of strategy. Not only would this revolutionize economics, but the entirely new field of scientific inquiry it yielded--game theory--has since been widely used to analyze a host of real-world phenomena from arms races to optimal policy choices of presidential candidates, from vaccination policy to major league baseball salary negotiations. And it is today established throughout both the social sciences and a wide range of other sciences.This sixtieth anniversary edition includes not only the original text but also an introduction by Harold Kuhn, an afterword by Ariel Rubinstein, and reviews and articles on the book that appeared at the time of its original publication in the New York Times, tthe American Economic Review, and a variety of other publications. Together, these writings provide readers a matchless opportunity to more fully appreciate a work whose influence will yet resound for generations to come.

    The authors provide precise definitions and full proofs of results, sacrificing generalities and limiting the scope of the material in order to do so. The text is organized in four parts: strategic games, extensive games with perfect information, extensive games with imperfect information, and coalitional games. It includes over 100 exercises. Solution ManualTable of Contents, Errata, and more...

    . . a most valuable contribution." — Douglas R. Hofstadter, author of Gödel, Escher, BachThe foundations of game theory were laid by John von Neumann, who in 1928 proved the basic minimax theorem, and with the 1944 publication of the Theory of Games and Economic Behavior, the field was established. Since then, game theory has become an enormously important discipline because of its novel mathematical properties and its many applications to social, economic, and political problems.Game theory has been used to make investment decisions, pick jurors, commit tanks to battle, allocate business expenses equitably — even to measure a senator's power, among many other uses. In this revised edition of his highly regarded work, Morton Davis begins with an overview of game theory, then discusses the two-person zero-sum game with equilibrium points; the general, two-person zero-sum game; utility theory; the two-person, non-zero-sum game; and the n-person game.A number of problems are posed at the start of each chapter and readers are given a chance to solve them before moving on. (Unlike most mathematical problems, many problems in game theory are easily understood by the lay reader.) At the end of the chapter, where solutions are discussed, readers can compare their "common sense" solutions with those of the author. Brimming with applications to an enormous variety of everyday situations, this book offers readers a fascinating, accessible introduction to one of the most fruitful and interesting intellectual systems of our time.

    It's the art of anticipating your opponent's next moves, knowing full well that your rival is trying to do the same thing to you. Though parts of game theory involve simple common sense, much is counterintuitive, and it can only be mastered by developing a new way of seeing the world. Using a diverse array of rich case studies—from pop culture, TV, movies, sports, politics, and history—the authors show how nearly every business and personal interaction has a game-theory component to it. Are the winners of reality-TV contests instinctive game theorists? Do big-time investors see things that most people miss? What do great poker players know that you don't? Mastering game theory will make you more successful in business and life, and this lively book is the key to that mastery.

    It proposes enlightening similarities between, for instance, maneuvering in limited war and in a traffic jam; deterring the Russians and one's own children; the modern strategy of terror and the ancient institution of hostages.

    In the modern experimentalist paradigm, these techniques address clear causal questions such as: Do smaller classes increase learning? Should wife batterers be arrested? How much does education raise wages? Mostly Harmless Econometrics shows how the basic tools of applied econometrics allow the data to speak.In addition to econometric essentials, Mostly Harmless Econometrics covers important new extensions--regression-discontinuity designs and quantile regression--as well as how to get standard errors right. Joshua Angrist and Jorn-Steffen Pischke explain why fancier econometric techniques are typically unnecessary and even dangerous. The applied econometric methods emphasized in this book are easy to use and relevant for many areas of contemporary social science.An irreverent review of econometric essentials A focus on tools that applied researchers use most Chapters on regression-discontinuity designs, quantile regression, and standard errors Many empirical examples A clear and concise resource with wide applications

    He solidified his standing as the nation's foremost political forecaster with his near perfect prediction of the 2012 election. Silver is the founder and editor in chief of FiveThirtyEight.com. Drawing on his own groundbreaking work, Silver examines the world of prediction, investigating how we can distinguish a true signal from a universe of noisy data. Most predictions fail, often at great cost to society, because most of us have a poor understanding of probability and uncertainty. Both experts and laypeople mistake more confident predictions for more accurate ones. But overconfidence is often the reason for failure. If our appreciation of uncertainty improves, our predictions can get better too. This is the "prediction paradox": The more humility we have about our ability to make predictions, the more successful we can be in planning for the future.In keeping with his own aim to seek truth from data, Silver visits the most successful forecasters in a range of areas, from hurricanes to baseball, from the poker table to the stock market, from Capitol Hill to the NBA. He explains and evaluates how these forecasters think and what bonds they share. What lies behind their success? Are they good-or just lucky? What patterns have they unraveled? And are their forecasts really right? He explores unanticipated commonalities and exposes unexpected juxtapositions. And sometimes, it is not so much how good a prediction is in an absolute sense that matters but how good it is relative to the competition. In other cases, prediction is still a very rudimentary-and dangerous-science.Silver observes that the most accurate forecasters tend to have a superior command of probability, and they tend to be both humble and hardworking. They distinguish the predictable from the unpredictable, and they notice a thousand little details that lead them closer to the truth. Because of their appreciation of probability, they can distinguish the signal from the noise.

    Though the answers may seem simple, their profound implications make the prisoner's dilemma one of the great unifying concepts of science. Watching players bluff in a poker game inspired John von Neumann--father of the modern computer and one of the sharpest minds of the century--to construct game theory, a mathematical study of conflict and deception. Game theory was readily embraced at the RAND Corporation, the archetypical think tank charged with formulating military strategy for the atomic age, and in 1950 two RAND scientists made a momentous discovery.Called the prisoner's dilemma, it is a disturbing and mind-bending game where two or more people may betray the common good for individual gain. Introduced shortly after the Soviet Union acquired the atomic bomb, the prisoner's dilemma quickly became a popular allegory of the nuclear arms race. Intellectuals such as von Neumann and Bertrand Russell joined military and political leaders in rallying to the preventive war movement, which advocated a nuclear first strike against the Soviet Union. Though the Truman administration rejected preventive war the United States entered into an arms race with the Soviets and game theory developed into a controversial tool of public policy--alternately accused of justifying arms races and touted as the only hope of preventing them.A masterful work of science writing, Prisoner's Dilemma weaves together a biography of the brilliant and tragic von Neumann, a history of pivotal phases of the cold war, and an investigation of game theory's far-reaching influence on public policy today. Most important, Prisoner's Dilemma is the incisive story of a revolutionary idea that has been hailed as a landmark of twentieth-century thought.

    Dozens of examples in innumeracy show us how it affects not only personal economics and travel plans, but explains mis-chosen mates, inappropriate drug-testing, and the allure of pseudo-science.

    Bueno de Mesquita uses game theory and its insights into human behavior to predict and even engineer political, financial, and personal events. His forecasts, which have been employed by everyone from the CIA to major business firms, have an amazing 90 percent accuracy rate, and in this dazzling and revelatory book he shares his startling methods and lets you play along in a range of high-stakes negotiations and conflicts.Revealing the origins of game theory and the advances made by John Nash, the Nobel Prize—winning scientist perhaps best known from A Beautiful Mind, Bueno de Mesquita details the controversial and cold-eyed system of calculation that he has since created, one that allows individuals to think strategically about what their opponents want, how much they want it, and how they might react to every move. From there, Bueno de Mesquita games such events as the North Korean disarmament talks and the Middle East peace process and recalls, among other cases, how he correctly predicted which corporate clients of the Arthur Andersen accounting firm were most likely engaged in fraudulent activity (hint: one of them started with an E). And looking as ever to the future, Bueno de Mesquita also demonstrates how game theory can provide successful strategies to combat both global warming (instead of relying on empty regulations, make nations compete in technology) and terror (figure out exactly how much U.S. aid will make Pakistan fight the Taliban).But as Bueno de Mesquita shows, game theory isn’t just for saving the world. It can help you in your own life, whether you want to succeed in a lawsuit (lawyers argue too much the merits of the case and question too little the motives of their opponents), elect the CEO of your company (change the system of voting on your board to be more advantageous to your candidate), or even buy a car (start by knowing exactly what you want, call every dealer in a fifty-mile radius, and negotiate only over the phone).Savvy, provocative, and shockingly effective, The Predictioneer’s Game will change how you understand the world and manage your future. Life’s a game, and how you play is whether you win or lose.

    How can we catch schools that cheat on standardized tests? How does Netflix know which movies you’ll like? What is causing the rising incidence of autism? As best-selling author Charles Wheelan shows us in Naked Statistics, the right data and a few well-chosen statistical tools can help us answer these questions and more.For those who slept through Stats 101, this book is a lifesaver. Wheelan strips away the arcane and technical details and focuses on the underlying intuition that drives statistical analysis. He clarifies key concepts such as inference, correlation, and regression analysis, reveals how biased or careless parties can manipulate or misrepresent data, and shows us how brilliant and creative researchers are exploiting the valuable data from natural experiments to tackle thorny questions.And in Wheelan’s trademark style, there’s not a dull page in sight. You’ll encounter clever Schlitz Beer marketers leveraging basic probability, an International Sausage Festival illuminating the tenets of the central limit theorem, and a head-scratching choice from the famous game show Let’s Make a Deal—and you’ll come away with insights each time. With the wit, accessibility, and sheer fun that turned Naked Economics into a bestseller, Wheelan defies the odds yet again by bringing another essential, formerly unglamorous discipline to life.

    Len Fisher turns his attention to the science of cooperation in his lively and thought-provoking book. Fisher shows how the modern science of game theory has helped biologists to understand the evolution of cooperation in nature, and investigates how we might apply those lessons to our own society. In a series of experiments that take him from the polite confines of an English dinner party to crowded supermarkets, congested Indian roads, and the wilds of outback Australia, not to mention baseball strategies and the intricacies of quantum mechanics, Fisher sheds light on the problem of global cooperation. The outcomes are sometimes hilarious, sometimes alarming, but always revealing. A witty romp through a serious science, Rock, Paper, Scissors will both teach and delight anyone interested in what it what it takes to get people to work together.

    From Edward Lorenz’s discovery of the Butterfly Effect, to Mitchell Feigenbaum’s calculation of a universal constant, to Benoit Mandelbrot’s concept of fractals, which created a new geometry of nature, Gleick’s engaging narrative focuses on the key figures whose genius converged to chart an innovative direction for science. In Chaos, Gleick makes the story of chaos theory not only fascinating but also accessible to beginners, and opens our eyes to a surprising new view of the universe.

    Mandelbrot, one of the century's most influential mathematicians, is world-famous for making mathematical sense of a fact everybody knows but that geometers from Euclid on down had never assimilated: Clouds are not round, mountains are not cones, coastlines are not smooth. To these classic lines we can now add another example: Markets are not the safe bet your broker may claim. In his first book for a general audience, Mandelbrot, with co-author Richard L. Hudson, shows how the dominant way of thinking about the behavior of markets-a set of mathematical assumptions a century old and still learned by every MBA and financier in the world-simply does not work. As he did for the physical world in his classic The Fractal Geometry of Nature, Mandelbrot here uses fractal geometry to propose a new, more accurate way of describing market behavior. The complex gyrations of IBM's stock price and the dollar-euro exchange rate can now be reduced to straightforward formulae that yield a far better model of how risky they are. With his fractal tools, Mandelbrot has gotten to the bottom of how financial markets really work, and in doing so, he describes the volatile, dangerous (and strangely beautiful) properties that financial experts have never before accounted for. The result is no less than the foundation for a new science of finance.

    Darrell Huff runs the gamut of every popularly used type of statistic, probes such things as the sample study, the tabulation method, the interview technique, or the way the results are derived from the figures, and points up the countless number of dodges which are used to fool rather than to inform.